This gives rise to a Wall Street parlor game to guess which picks will come next. Right now, there’s a strong argument for some fresh blood in the financial sector.

European Pressphoto Agency

Building mREITs in the S&P 500?

The argument is made this week over at Keefe, Bruyette & Woods, whose Melissa A. Roberts and Kelly Motta have some arrows in their financial quiver. Among them: Two of the five currently pending M&A deals for S&P 500 will remove financial stocks from the index if and when they’re completed. While the index doesn’t automatically replace stocks lost to M&A with others from the sector, there’s a ‘fairness’ argument in favor of it.

Also: The 19% jump in the index’s financial components YTD highlights how this sector’s heft is increasing. An index that purports to reflect the market as it really is arguably has to pay financials more heed as their valuations rise.

From this point, the analysts make the argument that it’s time for a mortgage real estate investment trust, which became eligible for S&P 500 inclusion this year. Their candidate for the job: Annaly Capital Management (NLY), which could see a price bump from indexers’ demand if KBW’s view wins out.

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As exchange-traded funds and other investing vehicles have ballooned in number, the task of figuring out what works well and what doesn’t has only gotten harder. Barrons.com’s Focus on Funds looks under the hood of ETFs, mutual funds and hedge funds for overlooked values, actionable ideas and the latest pitfalls for fund investors.